Customs fined a Greek Cypriot man €30,000 for smuggling 277 cartons of cigarettes and 22.7 kilos of tobacco from the Turkish occupied areas in the north of the island.
The contraband was seized by police last Saturday, while the man was arrested.
Following an out of court settlement, the man agreed to pay €30,000 and he was released, a written statement said.
The cigarettes and tobacco were left in the possession of customs.
The law allows the customs department to impose fines up to three times the value of the cigarettes.
Authorities are particularly strict with cigarettes and tobacco coming from the north.
The man could have claimed the cigarettes inside a month but customs would have countered with a seizure request and the case would have gone to court.
It is understood that customs have never lost cases like these since 1960.